Question

Which of the following statements about forecasting methods used in hospitality operations is false?

a. The two most important factors in selecting a forecasting method for a hospitality operation are the size and complexity of the operation and the skill of staff in forecasting?
b. Even with the best forecasts, managers should be prepared to cover deviations in activity from the forecasted levels of activity.
c. The more removed the forecast period is from the date the forecast is made, the greater the difficulty in making the forecast.
d. When using a moving average forecasting approach, the greater the number of periods used in calculating the moving average, the less the effect of random variations.

Answer 1

The false statement is the one that suggests the two most important factors in selecting a forecasting method for a hospitality operation are the operation's size and complexity and the staff's forecasting skill. Factors such as cost, time horizon, historical data, and desired accuracy are also crucial.

Step-by-step explanation:

The statement about forecasting methods used in hospitality operations that is false is: a. The two most important factors in selecting a forecasting method for a hospitality operation are the size and complexity of the operation and the skill of staff in forecasting. While these factors can influence the choice of forecasting method, they are not the only considerations. Other critical factors include the cost of the forecast, the time horizon of the forecast, the availability of historical data, and the desired accuracy of the forecast.

Indeed, managers should always be ready to adjust to actual conditions that deviate from forecasted levels as per statement b. Also, the farther out the forecast, the more difficult it typically is to predict accurately, making statement c true. Lastly, statement d is correct; using a larger number of periods in a moving average approach does tend to smooth out random variations.